Record deferred spending carried into 2026
The Generalitat, Catalonia's regional government, deferred €5.295 billion in non-financial spending from 2025 to 2026, a 12% increase from the previous year and the highest figure on record. This means more than 10% of all non-financial expenditure in 2025 consisted of unpaid obligations carried forward, according to the Generalitat's 2025 general accounts prepared by the General Intervention. The practice, known as displaced or deferred spending, reflects a structural mismatch between budgeted allocations and actual expenditure. Despite a credit supplement of €5.988 billion approved with support from ERC, the 2023 budgets were extended again in 2025, failing to close the gap.
Health sector drives debt accumulation
Of the total deferred amount, €3.372 billion relates to the Servei Català de Salut (SCS) and the Institut Català de la Salut (ICS), where chronic underfunding and rising costs in health and pharmacy contracts have strained resources. The 2025 general accounts attribute the increase to several factors: a 2.5% public sector pay rise and associated social security contributions paid in early 2026 (€195 million for civil servants, €9 million for political appointees), and a €83 million productivity bonus paid in April 2026. The health budget for 2025 was initially set at €11,210.3 million but had risen to €13,104.1 million by June, according to the mid-year budget execution report. The deviation between planned and actual spending, between 15% and 20%, has become routine.
As long as the health budget continues to be below actual health spending, between 3,000 and 5,000 million euros of annual public debt will continue to be generated.
This warning, previously issued by Metges de Catalunya, underscores the systemic nature of the shortfall.
Previous measures failed to reverse trend
The government led by Pere Aragonès (ERC) had planned an €800 million extraordinary fund in the 2024 budget to reduce the backlog, but the budget did not pass before Aragonès called early elections. The subsequent administration, led by Salvador Illa of the PSC, inherited a backlog of €4.731 billion in unpaid invoices from 2023, as reported in the final liquidation of that year’s accounts. Although measures introduced in November 2024, such as mandatory electronic invoicing and automated payment processing, have improved payment times, they have not addressed the underlying fiscal imbalance. In January 2025, the average payment period (PMP) for suppliers across the Catalan administration fell to 26.9 days, nearly 10 days faster than January 2024, and the third consecutive month below 30 days. The Servei Català de la Salut now pays suppliers in an average of 11 days, according to data from the Generalitat’s Intervention Office.
Financing reform stalled
Long-term fiscal stability depends on a new regional financing model, under which the Catalan Tax Agency (ATC) would collect all taxes, including personal income tax. However, progress has stalled. A meeting of the Council of Fiscal and Financial Policy (CPFF), scheduled for 29 July, was cancelled after opposition from PP-governed regions. A new session is set for 4 September. Only the Spanish government and Catalonia currently back the reform; even Asturias, governed by the Socialists, has not endorsed it. Without agreement, the bill cannot advance to Congress, where its passage remains uncertain. If implemented, the model would increase Catalonia’s annual revenue by nearly €4.7 billion.
Primary sources: govern.cat. Reported by en.ara.cat, Marcos Lamelas, Agustí Sala, Àngels Piñol, Arturo Puente, Diari ARA.
